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tv   Studio 1.0  Bloomberg  December 24, 2014 1:00pm-1:31pm EST

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data $100 per month. that is an amazing deal. >> moving onto the number one stock of the day. it is apple. piper jaffray analyst gene munster reporting apple supply of new phones has searched just in time for christmas. here are we are at the close. the s&p is ending the day barely in the green. the dow jones ending the day up slightly. we had been seeing sums significant gains earlier in the session. the dow and s&p did seem to close out the day in the green. how that goes out. more to come. but the dow
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you say? looks better than a stick in the eye. >> where to go from here. are you closing the books on that? >> i'm one of those managers that says, you get out while you are still, i'm going to call it. and the bloomberg reporter. there are the rumors.
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>> we would be selling into the upside. we went from overweight to neutral. we started to see perhaps subpar kind of returns for 2015. that is on the back of decelerating global growth. gdp, real gdp. >> yesterday's number didn't sway you at all? i can't believe it, 5%. itwhen you start to smooth out, where did you go? gdp was below 3% on a real basis. is not terrific. that is still below trend growth. real gdp. >> and you include inflation. inflation is about one and a half percent.
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>> today was a pretty slow day for markets. >> this is the answer to questions that allowed people have had about stock markets, about bond markets, will bond markets increase? how much do low oil prices really benefit stock markets. junk markets have not been rallying for the analog to stocks. how because they do not see oil prices could potentially rise. hurt the potentially credit market. >> credit this location on the high-yield market, how that will affect the cvs market.
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you have to look at the and then debt market feedback loop. >> you are worried about that as the contagion? >> yes, i am worried about a lot of contagions, in particular the feedback loop of oil going to perhaps $40 a barrel and what the effect is. ginnede things, gdp gets up. one is six jobs over the last several months, several years has been because of oil-related industry. of that you put on top all of the high-yield debt that has been out there, because of oil and gas, and you come up with something that is perhaps a little bit more of a concern. >> the market for dollar-denominated is triple.
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this is a potential risk to the market. we had this huge run in the last 24 months. expect the dollar to continue to strengthen. will be ing markets that area too. >> the u.s. is not an island, so we are not going to see this kind of last quarter gdp report continue into next year. how much are we not an island? look, we are decoupling. we are not affected by what is going on in europe and asia, 12% of our economy is driven by
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exports, it is not a massive amount. >> that is a great economic statistic, but when you start to get a credit and sovereign debt dislocation, which we have seen before, you have reported about it many times, then all those people run underneath their bed and hide in their basements. then the volatility kicks higher. what we are suggesting is that we are not an island like mohammed is saying and you want to start moving up the quality spectrum and yet the federal reserve will move a quarter or half of a percent of 2015. the third quarter, perhaps the fourth quarter. >> the federal reserve has been brilliant. they have been able to increase interest rate expectations. the actual inflation rate has been well below trend for the last 24 months. sometimes it pops up by 2% but it always goes lower. muchen you talk about how
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the u.s. can decouple from the rest of the world really relies and the consumer. what happens of those returns start turning negative? what does that do to consumer confidence? >> what kind of consumers are piling into riskier assets to get yields? >> what about pension plans? >> they don't know, if you are a cop, a fireman, or a teacher, you're not like, my mutual fund is piling into these riskier asset searching for yields and if i don't get it, i will not be able to buy a new chrysler. that is not how it works. my mother is a teacher. she is informed but she is not worried about the high-yield junk on her teachers credit union mutual fund. i don't think that affects consumer confidence.
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>> gas prices do. if you see gas coming down. yesterday, people were tweeting me gas prices of $1.42 a gallon. someone treated me an oil painting a good of you? we'll talk about that after the show. down, prices are coming that is got to affect consumer confidence and a positive way. >> that is great if you want to buy soft goods. what will it do to the expansion of mortgage credit? will one go out and buy a large home in montclair new jersey and leverage themselves to do that? mortgage credit has not grown since the great recession. it has moderately increased this quarter. >> maybe that is good. what is wrong with having a good old-fashioned 20% down and a steady income to show?
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>> the beauty is that you said study and become. you canehold income, look it up on your bloomberg terminal, as well hello what it was in 2008. it is not growing. if you adjust for inflation, it is lower. >> perhaps the question is, given that you still have to put 20% down on your house and people are being somewhat restrained which is a bubbly a positive, can the market, can the s&p, can the russell 2000 continue to expand that such a fast rate, continue to rise at a fast rate, given the pack that people have ratcheted up their spending? >> from a long-term perspective, we ratcheted our total return down to 5-6%. we are expecting for 2015 an upward bias to the market in the u.s. but nonetheless, none like we have seen back in 2015.
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>> thank you very much. matt miller, thank you. >> merry christmas to you and merry christmas to all of you, everyone. have a wonderful wonderful holiday. we will see you back here on friday.
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>> something you talk about is the danger of the founders becoming a victim of their own
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miss? >> somehow it is singular and there are somehow the are divine impudent beings. i have friends who i talked to a lot, people that work with me closely. >> i'm curious about your background and what has shaped your views along the way. you were born in germany, you moved around a lot. >> i lived in a lot of different places. i think about myself as having been a little bit of an outsider and a little bit of an insider. so there is kind of a combination of outsider-insider perspective that shaped me a lot. >> what were your parents like? >> my dad was an engineer. my mom was a homemaker. they were focused on education. >> you were raised an evangelical christian and did not believe in anything like evolution? >> i still consider myself a christian and i think it is important to have a very different perspective on things, because it pushes you to either
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defend your ideas really well or to have a much deeper understanding of why they are wrong. >> on paper you worked in a new york law firm and you worked on wall street. it sounds pretty standard. where is the renegade in you? >> there was a sense that i could not see myself as being happy doing this. >> was there any event in life that triggered you to start down a different path? >> it was a bit of an evolution. i can point to late nights at the law firm where i was asking myself, what am i doing here? >> who do you call for what? >> there is something about a set of my friends from paypal, there is an intense experience and i think those bonds will never quite be matched in their
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intensity. >> in your book, the first line in chapter 14 is, "of the six people who founded paypal, four of them built bombs in high school." >> i was not one of those four. [laughter] i think there is something that is quite extreme about personalities of going to starting up a company. having extreme personalities is a somewhat good things. >> who built the bombs? it wasn't you? >> i can't say. >> as successful as so many members of the paypal mafia has been, you have also had failure. why? >> it was a failure and that we did not achieve our original vision of a completely new currency system. >> what about bitcoin, does that get closer to what you imagine? >> i am psychologically biased against it. i would be tempted to come up with reasons why nobody would succeed at it.
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>> chances of it succeeding are unlikely? >> i think it is slightly too cumbersome to work as a new payment system. >> you were the first outside investor in in facebook. did you convince mark or did he convince you? >> some combination of both. the company was growing fast. i convince them i would be relatively hands-off. >> do you worry facebook to get this tractive? -- facebook could get distracted tackle >> it is always a challenge. you have to do new things, because you are not in a static world, and you don't want to do too many. you want to do the right number of things. >> you created palantir. customers include the cia and
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the air force, yet there is so much mystery around it. as i understand, palantir is using data on a massive scale to solve problems from disease to terrorism. >> it is always an interactive problem. part of the data can be processed by computers. parts of that data can be analyzed by humans. palantir was critical in connecting all the dots in fighting bin laden. >> do you think you could stop the next 9/11, or has it already? >> i don't think we are going to do it by projecting military force throughout the world, i think we will do it by sort of very cleverly uncovering these conspiracies before they come together. >> some have expressed concern that palantir could actually be used to do evil things? do you worry about that? >> there is always a two edged part to these technologies. technologies are never in -- there is always a question of how they can be used or abused. i think there are a lot of
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checks in place. >> someone described it as plugging into the matrix. >> one government agency that gave us a bunch of data, we uncovered a terrorist plot they had not suspected. this led them to conclude they had to reclassify data as classified. >> would you say it has helped thwart multiple terrorist plots? >> i suspect that is true. >> what is the craziest sector that you might enter that we would not expect? >> one that we started to look at the margins that is wildly out of fashion is the nuclear power industry. is it possible to build safer, cheaper, better reactors with all of these new technologies? and when you look at the
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technologies, it looks like the answer is definitely yes. i am very worried about the regulatory issues with it. but i think it is worth tackling that some more. >> i want to talk more about your vision of the future and man versus machine. you are not concerned that machines are going to take our jobs? >> not anytime soon. i think technology has freed people up to do other things. >> at some point though, you said in the 22nd century, computers could be smarter than us.
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>> there is always an interesting sort of debate and how will that change things? i don't think that will happen for a long time, but i think our political and cultural problems, i think it is like having extraterrestrial landing on the planet. if we had aliens landing on this planet, we would not ask the first question, what does this mean for my job. we would ask, are they friendly or not friendly. >> have you pondered about how humans could potentially survive in the future? >> we should give nuclear power very serious consideration, it does not create greenhouse gases. >> is mars going to be first? >> there are a lot of things that make mars natural, yes. >> you ponder several other different futures, including human extinction. what are the possibilities about that? >> what are the technologies we need to develop? we need to stay focused on that and i think our prospects are
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very good. >> you have a startup island off the coast. what is your vision there? >> this is a very small-sized project. is it possible to create some new community that we could start a new society that would have very different rules and be able to govern itself? this is still far in the future, but it has a lot of people interested. >> so you're talking about another country? >> it would be another country, and it would cost tens of billions to build, more capital than i have. >> you think that you may live to be 120. >> i certainly hope to, yes. ♪
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>> you have been portrayed on the hbo show "silicon valley" and this island has been portrayed on the show. have you watched it? >> they would dispute they were portraying me. >> he invested in an island. >> i think the character gives a compelling portrayal of someone who is passionate about the future, determined to make things happen. people are driven, slightly crazy. i think it is a positive show. >> do you believe you can grow meat in a lab?
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>> yes, i think the problem is if somebody will actually eat it. >> what you think about failure? >> this idea that failure is ok is a destructive means. i think that failure is always a problem. when a company fails, it is a tragedy. it is often damaging for the people who go through it. >> what is your biggest failure? >> there are some things that work better than others.
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but, on the whole, i have always been resilient. >> i know you have thought a lot about the extension of human life. you think that you may live until 120. >> i certainly hope to, yes. >> are you taking immortality pills? >> i think on the nutrition side, there are some very basic things that can be done. you should not eat sugar. that is the one nutritional rule. >> do you not eat sugar? >> i still do, but not so much. >> what do you eat more of? >> i do the paleo diet. that does not get you to 120. you need new technology and innovation for us to have a longer and healthier lives. >> like what?
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>> cures for cancer, alzheimer's, find ways to restore organs when they are falling apart. the main, drastic thing i am doing is i am on hgh, human growth hormone, on a daily basis. >> what is the benefit of that? >> it helps maintain muscle mass, so you are much less likely to get bone injuries, arthritis, stuff like that. it increases your cancer risk. i am hopeful we will get cancer cured in the next decade. the other thing that is happening is all of the stuff on the bio level, where you have as many bacteria inside of you as cells. hopefully we can reset your bacterial ecosystem. you can look at people who are super healthy, you can figure out what ecosystem they have and replace yours with theirs. >> peter thiel, thank you so much for joining us today on
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"studio 1.0," it was great having you. ♪
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>> he made his name as a top tech analyst on wall street, leading coverage of the amazon ipo. then, bill gurley made his way to the promised land of silicon valley, launching a venture capitalist firm, joining venture capital in 1999. almost right away, the bubble burst. bill gurley rode the market up and down, along the way making his early bets on some of the hottest names -- twitter, uber, snapchat, instagram. joining me today on "studio 1.0," seasoned venture capitalist bill gurley. you recently sounded the alarm about startups and fund raising in silicon valley, saying that silicon valley is taking on an excessive amount of risk, "unprent


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